Infy adopts new charter to tackle shareholder concerns

Bengaluru: Infosys has adopted a new charter for its board committee that oversees relationships with stakeholders, a move that is seen as a response to the public criticism of some of the company’s decisions by several of its promoters.

The committee is tasked to assist the company and the board to receive and address grievances from stakeholders. The committee comprises of four independent directors as members – Jeffrey S Lehman, who is the committee’s chairperson, John Etchemendy, Ravi Venkatesan (now the co-chairman of the board) and DN Prahalad, who was appointed as its member effective January 13.

Co-founder N R Narayana Murthy and several others had questioned the compensation and severance packages offered to several top executives, as also certain acquisitions made by the company in the past year.
The stakeholders’ relationship committee is not new, but now has a fresh mandate to review and redress investor grievances. The committee adopted a charter in January to assist the board and the company in maintaining healthy relationships with all stakeholders. The committee will oversees the mechanisms for redressing grievances from shareholders, debenture holders, employees, vendors and customers. It will also have mechanisms to redress whistle blower and internal complaints. When the promoter differences were aired publicly, Infosys had received several complaints from whistleblowers.

The fresh mandate of the committee is to review the company’s performance in dealing with stakeholder grievances and have access to any internal information to fulfil its role. The committee can obtain advice and assistance from internal or external legal, accounting and other advisors. It will also review adequacy of the charter and propose changes to the Board for approval. The committee will meet four times a year.
“We have been advocating for a while on redefining the role of the stakeholders, beyond airing grievances – what are their views on the company, their voting patterns,” Amit Tandon, managing director of Institutional Investor Advisory Services (IIAS), said.
The committee’s fresh mandate comes at a time when the Infosys board has also roped in law firm Cyril Amarchand Mangaldas to prescribe a new governance code for the IT behemoth aimed at addressing the concerns raised by its founders. Shriram Subramanian, MD of corporate governance research firm InGovern Research Services, wondered what role Cyril Amarchand Mangaldas would play given the new mandate of the committee.
Source: Zee News
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